30-year mortgage rate falls for the ninth week

Benchmark mortgage sets third consecutive low in Freddie Mac survey

CHICAGO (MarketWatch) -- The average rate on 30-year fixed-rate mortgages fell for the ninth week in a row this week, setting another record low, according to Freddie Mac's weekly survey released on Wednesday.

The 30-year fixed-rate mortgage averaged 5.10% for the week ending Dec. 31, down from 5.14% last week and 6.07% a year ago. The mortgage rate hasn't been lower since Freddie Mac started the Primary Mortgage Market Survey in 1971. The survey covers conventional, conforming mortgages.

Rates on 15-year fixed-rate mortgages also fell, averaging 4.83% this week, down from 4.91% last week and 5.68% a year ago. The mortgage hasn't been lower since March 25, 2004, when it averaged 4.70%.

Five-year Treasury-indexed hybrid adjustable-rate mortgages averaged 5.57%, up from 5.49% last week. The ARM averaged 5.78% a year ago. And 1-year Treasury-indexed ARMs averaged 4.85%, down from last week's 4.95%. The ARM averaged 5.47% a year ago.

To obtain the rates, the 30-year and 15-year fixed-rate mortgages and the 5-year ARM required payment of an average 0.7 point. The 1-year ARM required payment of an average 0.5 point. A point is 1% of the total mortgage amount, charged as prepaid interest.

"Interest rates for 30-year fixed-rate mortgages fell for the ninth straight week and represented a third consecutive all time record low since Freddie Mac's survey began in April 1971," said Frank Nothaft, Freddie Mac chief economist, in a news release. "Since the end of October of this year, these rates have declined by about [1.33] percentage points, or payment savings of approximately $173 a month for a $200,000 loan," he said.

"As a result, the number of refinance applications for conventional mortgages jumped over 500% between the weeks ending on Oct. 31 and Dec. 26," Nothaft said. According to MBA's weekly survey, overall mortgage applications were up 155% last week, compared with the same week in 2007. See full story.

Lower rates and falling home prices are making homeownership more affordable, Nothaft said.

"For instance, house prices fell 18% over the 12-month period ending in October, according to the S&P/Case-Shiller 20-city composite index. Every city posted a second consecutive month of decline in October. From its peak set in July 2006, the composite index is down 23.4%," he said. See full story.

Intraday Data provided by SIX Financial Information and subject to terms of use.
Historical and current end-of-day data provided by SIX Financial Information.
All quotes are in local exchange time. Real-time last sale data for U.S. stock quotes reflect trades reported through Nasdaq only.
Intraday data delayed at least 15 minutes or per exchange requirements.